- The Washington Times - Monday, December 11, 2000

There are 14 shopping days until Christmas. (Unless you're of the Russian Orthodox faith and celebrate the Nativity on Jan. 7.) Hanukkah celebrants have just 10 days until the first night of that celebration.

Shopping malls will be crowded, or even packed solid, with those struggling to find bargains. The "virtual" malls of the Internet also will be jam-packed.

In the midst of the Internet's buying mania, there is an on-line shopping site suited to just about everyone's taste. I found one company that's doing things more than a little differently. California-based LiquidPrice.com is making retailers compete for your business by offering low prices.

Even more interesting to this observer, at least is the software underlying the strategy. It's IBM's WebSphere, which runs on large systems and is able to get techno-businesses up and running quickly. IBM's WebSphere products are rapidly becoming the industry standard for companies large and small in electronic commerce. WebSphere ties together databases and other "back end" systems to help produce huge Web sites in record time, with rock-solid reliability.

For customers of LiquidPrice, those benefits include savings of at least 10 percent to 25 percent off retail prices. The firm concentrates on consumer electronics and watches, for now, but also offers rather impressive savings on cars. Other categories are planned for the future.

In many respects, LiquidPrice.com is a "third generation" of Internet shopping sites. There was Amazon.com's approach of cataloging books by having distributors help fulfill orders. Others created a warehousing-and-distribution network, which has led to the demise of scores of dot-coms in the past year. LiquidPrice is really a trafficker in vital information: connecting would-be buyers and sellers, using computer databases.

According to founder Piyush Gupta, a veteran of database software firm Informix, it was his wife's suggestion that the Web should bring information to her as opposed to having to search for something. That stuck with him when contemplating on-line buying. Instead of looking for the best price on a digital camera, why not have the dealers scurry to offer that price to the buyer?

Here's how it works: If you want a camera, stereo or even a car you select the desired item from an on-line catalog, let the firm know where you are (by ZIP code) and the item goes out for bid. Both your identity and that of the merchants bidding are kept anonymous, which protects customers from harassing calls and keeps dealers from colluding on prices.

Because merchant identities are kept anonymous, they can sell without diluting their brands.

"These are incremental sales without the $50 to $75 per-customer acquisition cost," Mr. Gupta added. "There are no marketing costs and low operational overhead, because the product only leaves the warehouse when it's sold. There is absolutely no reason why a reputable dealer should not be selling through our site."

While others shopping services claim to be "free," but end up with the digital equivalent of "fine print," LiquidPrice charges absolutely nothing to those who visit its site to buy consumer electronics, watches, cars, etc. Because of the firm's databases and WebSphere software they have retailers compete, disclosing prices to one another and the would-be customer.

When the choice is made and the price is right, the customer can buy. Either way, nothing is paid to LiquidPrice.com except by the seller after a successful sale.

In fact, everything about LiquidPrice.com says "satisfaction guaranteed." Visitors to the site are greeted by a tongue-in-cheek, but appropriate, message "Shop Till They Drop." "They," being the merchants, of course.

"Well, 'they' could also be the prices," Mr. Gupta said. There's also a toll-free service center to help the company monitor complaints and ensure customer satisfaction.

Shoppers have flexible buying options. After two days the length of time a Regular Bid is listed or earlier if consumers find a bid they like, they can walk away with the lowest price. More eager buyers can submit a Flash Bid with a "reserve" price they are willing to pay. Flash Bids must be completed within six hours, and the purchase is preauthorized should the buyer's reserve price be met.

Mr. Gupta said he is dedicated to seeing greater ethics on the Internet and the same concern for consumer treatment that is being focused on consumer security and privacy.

"As an industry, we have a responsibility to keep the public confident in representations made on the Internet. There is no place for false advertising, misleading procedures or puffery. We are pursuing relationships with key companies in many Internet-related industries to help establish an across-the-board ethical standard," he said.

• Write to Mark Kellner in care of The Washington Times, Business Desk, 3600 New York Ave. NE, Washington, D.C. 20002; send e-mail to [email protected], or visit the writer's Web page, www.kellner2000.com.

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